Archived press release

Fuel tax: why the chancellor has got it right

30 September 2003

The Chancellor of the Exchequer, Gordon Brown must not give in to fuel protests, Friends of the Earth said today. Motoring costs have fallen under Labour, and are set to fall still further.

An increase in fuel tax is needed because:

• It helps tackle traffic growth

  Rising traffic levels worsen problems of congestion, air pollution and climate change. Traffic levels rose by eight per cent between 1997 and 2002 [1], despite John Prescott's pledge in 1997 to cut the number of car journeys. According to Professor David Begg, Chairman of the Commission for Integrated Transport and the Government's chief transport advisor, for every one per cent rise in fuel prices, traffic levels rise by 0.18 per cent less than would have otherwise been the case [2].

• It helps tackle climate change

  Climate change is the biggest environmental threat facing the word today. Britain's leading climate scientist Sir John Houghton has described it as a `weapon of mass destruction' [3]. Road transport is the fastest growing UK source of carbon dioxide, the main climate change gas. Putting up fuel tax helps meet the Government's promise to cut carbon dioxide emissions to 20 per cent below 1990 levels by 2010 because it encourages the purchase and use of more fuel-efficient vehicles, and because of the impact on traffic levels. The Sustainable Development Commission has highlighted rising traffic levels as one of the key reasons why it believes the Government risks not meeting its carbon dioxide reduction target [4].

• Motoring is getting cheaper

  Motoring costs fell by 1.7 per cent between the first and second quarters of 2003 [5]. Between 1997 and 2001, motoring costs fell by 0.9 per cent in real terms, but bus fares rose by over five per cent and rail fares by over three per cent [6]. Transport 2010, the Government's 10-year transport plan, assumes that motoring costs will continue to fall for the rest of the decade, but shows that keeping costs constant would help meet the Government's congestion and pollution targets [7].

Friends of the Earth's Transport Campaigner Tony Bosworth said:

"The cost of motoring is falling. This is counter-productive if the Government really wants people to use their cars less. That's why Gordon Brown is right to put up fuel tax. This will help cut congestion, cut pollution and tackle climate change. He must ignore the protesters and stick to his guns. The Chancellor should go further, and consider putting up tax above the rate of inflation in next year's Budget and spend the revenue on providing better alternatives to the car".

Notes

[1] Department for Transport `Traffic in Great Britain: Q2 2003' August 2003

[2] The Guardian, 6 March 2001

[3] The Guardian, 28 July 2003

[4] Sustainable Development Commission press release `Towards a more sustainable UK - right direction, wrong speed' 24 February 2003

[5] RAC Insure Motoring Index, 1 September 2003

[6] House of Commons Written Answer, 20 November 2002

[7] Transport 2010 paragraph 9.13

[8] SEU Making the connections: Final report on transport and social exclusion para 2.3

[9] Institute for Fiscal Studies `The petrol tax debate' September 2000

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Published by Friends of the Earth Trust